Opinion
No. 26956.
June 11, 1928.
1. MORTGAGES. Bill seeking recovery of interest in land because of fraud in sale under trust deed held demurrable as against innocent incumbrancer.
Bill seeking recovery of interest in land on ground of fraud in sale under trust deed held demurrable as against innocent incumbrancer for value without notice of asserted right to require accounting for interest therein.
2. MORTGAGES. Bill seeking recovery of interest in land held to sufficiently charge fraud in sale under deed of trust.
Allegations of bill seeking recovery of interest in land on ground of fraud in sale under deed of trust held sufficient to charge fraud as against a minor on part of her relatives and purchaser thereof by affecting a chilling of bids at public sale.
3. MORTGAGES. Bill, seeking recovery of interest in land for fraud in sale under trust deed, need not charge beneficiary or trustee were parties thereto.
Bill, seeking recovery of interest in land on ground of fraud in sale thereof under deed of trust, need not allege that either beneficiary or trustee were parties to fraud of purchaser and others in affecting a chilling of bids at public sale.
4. AUCTIONS AND AUCTIONEERS. Fraudulent agreement between prospective bidders to refrain from bidding renders sale as to any confederate void.
Prospective bidders at a public sale cannot fraudulently agree together to refrain from bidding one against the other, and to do so renders the sale as to any confederate void.
5. MORTGAGES. Bill alleging fraud in sale of land under trust deed held not demurrable for failure to allege complainant did not receive share of proceeds.
Bill seeking recovery of interest in land on ground of fraud in sale under trust deed held not demurrable for failure to alleged complainant did not receive part of money in excess of debt, since such proposition constitutes matter of defense, and is not maintainable on demurrer.
6. LIMITATION OF ACTIONS. Bill alleging sale under trust deed at time debt was barred held not demurrable for failure to allege debt had not been extended or renewed ( Hemingway's Code 1927, section 2452).
Bill seeking recovery of interest in land on ground debt was barred by the six-year statute of limitations at time of sale under trust held not demurrable because of failure to allege that debt had not been extended or renewed within Hemingway's Code 1927, section 2452, Code 1906, section 2796, since a renewal or extension would constitute a matter of defense.
7. EQUITY. Demurrer conceded facts alleged in bill.
Demurrer interposed to bill operates to concede facts alleged therein.
APPEAL from chancery court, Second district of Hinds county; HON. V.J. STRICKER, Chancellor.
Hughes, Nobles Lane, for appellant.
It is a well-established rule of law that prospective bidders at public sales cannot fraudulently confederate and agree among themselves to refrain from bidding one against the other, and to do so renders sales to such confederates void. 6 R.C.L. 810, sec. 210. The bill of complaint charges that Dr. Burnett conveyed to Mrs. Sallie Heard for the benefit of Cicero Heard a tract of land embracing one hundred sixty acres in consideration of Cicero Heard refraining from bidding against Dr. Burnett at said sale and a copy of the deed from Dr. Burnett to the wife of Cicero Heard is made an exhibit to the bill of complaint. It is further set out in the bill of complaint that just four days before the alleged trustee's sale that Dr. E.J. Burnett approached T.H. Heard and secured from him a deed to these lands for a recited consideration of one hundred fifty dollars, and that the one hundred fifty dollars was paid to Heard as a consideration for Heard refraining from bidding on the land at the trustee's sale in which Dr. Burnett became the bidder, and a copy of the deed from T.H. Heard to Dr. E.J. Burnett, is also made an exhibit to the bill. It is also clearly and unequivocably charged that Dr. Burnett and Cicero Heard and T.H. Heard entered into these unlawful plots for the specific purpose of defeating the complainant who was then a minor, seven years old, and her minor sister Ruby out of their interest in these lands which they had inherited from their deceased mother. The bill further charges that at the time Dr. E.J. Burnett conveyed this land to his wife, Mrs. Olivia Burnett, that the latter accepted the deed with full and complete knowledge of all of the fraudulent acts set up between her husband, her grantor, Cicero Heard, and T.H. Heard, and that the conveyance to her was subject to all of the infirmities that the trustee's deed to her grantor was subject to and that she did not become vested with title to the land as an innocent purchaser for value.
Under sec. 2454, Hem. Code 1917, the right to bring actions for the recovery of realty is vouched sale and guaranteed to infants and persons of unsound mind for a period of ten years after reaching the age of twenty-one. Allen v. Hayes (Miss. not officially reported), 107 So. 208, does not overrule the case of Conn v. Boutwell, 101 Miss. 353, 58 So. 105; nor Clark v. Rainey, 72 Miss. 151, 16 So. 499. The reasoning of each of these cases is based on the different concrete facts found in the respective cases. They all harmonize. Barksdale v. Learnard et al., 112 Miss. 861, 73 So. 736, cannot be relied on by the appellee in this case because the rule announced in that case is that: "as against an innocent purchaser of land from one having the legal title, an infant having an equity in the land has no better standing than an adult." By an examination of the bill of complaint it will be found that Dr. E.J. Burnett and his wife, his vendee, cannot be treated as innocent purchasers. One of the precise questions presented for the court's decision is, can Mrs. Olivia Burnett here raise the bona-fide purchase for value defense by demurrer? Jones et al. v. Grimes et al., 115 Miss. 874, 76 So. 735.
Neither is there anything alleged in the bill that shows that the Federal Land Bank was an innocent purchaser or incumbrancer for value without notice. The bill shows that Dr. Burnett and his assigns went into wrongful possession of the land on the 16th day of February, 1903, and have continued in such possession up to this date; the bill shows on its face that the deed of trust under which the trustee sold when Dr. Burnett bought the land was barred, and that under the void sale Dr. Burnett and assigns went into wrongful possession of the land. So under the rules adhered to by the supreme court of our own state, neither the Burnetts nor the Federal Land Bank could set up the " bona-fide purchaser or incumbrancer defense" by demurrer. It is true the bill shows that the Burnetts in possession borrowed money from and executed to the Federal Land Bank a deed of trust, but the bill showed that the possession from the beginning of same had been wrongful. McDaniel et al. v. Short, 128 Miss. 520, 90 So. 186.
We take the position in the second place that the bank could not set up the defense of bona-fide incumbrancer for value without notice by demurrer, because the bill alleges that at the time of the pretended sale by the trustee to Burnett that the note and the deed of trust were barred by the statute of limitations. A copy of the deed of trust is filed with and made part of the bill of complaint; no due date is fixed in the deed of trust, and under the law it showed on its face it was due from on and after the date of its execution, and the record of the same was constructive notice to the Federal Land Bank that the deed of trust as security for the note was barred, on the date of the sale by the trustee to Dr. Burnett.
The demurrants take the position, and the chancellor concurred therein that the complainant could not plead and set up the bar of the statute of limitations in establishing her title to this land; that the statute barring the note and deed of trust could only be set up defensively, and not offensively; that the statute could be used as a shield, but not as a sword. As to the last proposition, we beg to call to the attention of the court that the bill of complaint does not undertake to show that complainant is asserting right and title to the land by virtue of the operation of the statute of frauds. The bill distinctly alleges that she became vested with the legal and equitable title to the land in question under the laws of descent and distribution; that her mother was the owner of the land, and that upon her death she fell heir to the land. The bill of complaint, incidentally, charges that through fraud, etc., alleged and pretended sales had taken place, and that deeds of conveyances thereunder had been filed and recorded, and that they were clouds upon complainant's title, and ask that they be cancelled, and for an order to sell for partition. We submit under these allegations of the bill that the statute of limitations barring the note and deed of trust could be set up for the purpose of showing that the sale under the barred note and deed of trust was void, and that this could be done in an affirmative or offensive manner.
Wells, Stevens Jones, for appellee, Federal Land Bank of New Orleans.
The demurrer of the Federal Land Bank after adopting that of the other defendants sets up the following grounds: "Because there is no equity on the face of the bill; because complainant does not offer to do equity; because the said bill shows on its face that these defendants are bona-fide encumbrancers for value, without notice of complainant's alleged rights; because the bill shows on its face that Yancie L. Heard and Cicero Heard, at the time of the death of Yancie Heard, had no title to the land involved in this cause, the title having passed to the trustee in the deed of trust to J.N. Carpenter Company, and hence the complainant inherited nothing. Because the bill shows on its face that as to these defendants, complainant's claim is a mere secret equity which cannot prevail against these defendants who are bona-fide encumbrancers for value, without notice. Because Cicero Heard is not joined as a defendant."
The Federal Land Bank of New Orleans and the other appellees are bona-fide incumbrancers and purchasers for value. Counsel for appellant has strenuously argued that the bill did not plead such facts as will enable us to raise this defense by the demurrer admitting at the same time that where the bill shows the facts that the defense is one which may be raised by demurrer.
In the first place this court will take judicial knowledge of the fact that the Federal Land Bank of New Orleans did not come into existence until after the passage by Congress of the Act of the 17th day of July, 1916, Fed. St. Ann. 1918 Supp., 14. Therefore, it was impossible for the Federal Land Bank to have been a party to any of the alleged fraudulent acts or conspiracies agreed upon or entered into or done by either Cicero Heard, Dr. E.J. Burnett, or any one else.
The following we submit is what the Federal Land Bank found of record with reference to this title at the time it made the loan and we ask the court to bear in mind that this loan, according to the bill was made September 15, 1923, over twenty years after the foreclosure sale.
In the first place it would have found the deed of trust from Heard and his wife, to J.N. Carpenter Company, reciting that it secured a debt of several thousand dollars and providing for foreclosure after maturity of the debt in case Heard and wife failed to pay principal and accrued interest at maturity. In the next place it would have found a valid substitution of Ben. H. Wells as trustee. In the next place it would have found a valid regular trustee's deed to Burnett from Ben. H. Wells, substituted trustee, reciting strict compliance with the law and the terms of the deed of trust and the payment of one thousand eight hundred dollars cash by Burnett to the trustee, that sum being the amount bid by Burnett for the property. In the next place it would have found that this entire proceeding was conducted by a reputable attorney, being an attorney who in his day and generation was a leader of the bar of the state, a man thoroughly versed in our law and a man against whose professional standards and integrity no question mark was ever put.
Going further into the record any one would have found Dr. Burnett paid taxes on the property, borrowed money on it by deed of trust and conveyed it for a valuable consideration to his wife and daughter. Any one dealing with the land would have found in 1923 that Dr. Burnett's deed had been of record for more than twenty years with the validity unchallenged by any other record in the land records of the county or by any court proceeding or any other public instrument of record. Examination further into the record would have revealed nothing to show that the complainant ever existed. Her name does not appear in the chain of title; there was no guardianship of her estate and so far as the records of the county are concerned (both land and court records), this complainant was non-existent.
Going dehors the records of the county, one dealing with the title would have found the following facts shown by the bill: That Dr. Burnett and his grantees were in actual occupancy of the property described in the bill, cultivating it and receiving the rents, issue and profits as charged by the first sentence of paragraph thirteen of the bill. He would further have found that this appellant was then twenty-eight years of age having been born December 20, 1895, and that notwithstanding that she had been of age seven years had never questioned the title of Dr. Burnett, his grantees and mortgagees.
Certainly on the face of the bill it cannot be gainsaid that at best appellant only had a right to elect to hold Dr. Burnett, as trustee, for her as his co-tenant and to exercise her right to her share in the property by forcing him to convey to her her interest, which action she must have taken before the rights of innocent persons intervened and in so doing, of course, she would have been required to repay to Dr. Burnett her pro rata of the indebtedness which he had paid off, with interest, taxes, etc., less her pro rata of the rents, issues and profits.
Moreover, the bill shows on its face that Yancie L. Heard, mother of this complainant, through whom she claims title, died in February, 1899. Therefore, taking the allegations of the bill that the note was due December 1, 1896, as being true, all title which Yancie L. Heard may originally have had to the property had absolutely vested in the trustee under the provisions of section 2449 of the Code of 1892. Therefore, not a vestige of title passed to this appellant on the death of Mrs. Heard. Title cannot rest in two persons. Under the statute quoted it was in Mrs. Heard until the condition of the deed of trust was broken. After that it vested absolutely in the trustee and having passed to him could not in law descend to this appellant.
Neither is there any substantiality to the position of appellant that the record shows that the note secured by the deed of trust executed by Heard and wife, was barred. The record shows no such thing. The deed of trust was silent as to the maturity of the note but it recited on its face that it was given in order to secure for Heard and wife the extension of time of payment for the debts they owed Carpenter and Company and that a new note evidencing the amount due had been executed as of the date of the deed of trust. Moreover, the instrument provided for interest from date until paid. In addition to that there was no power of sale in the trustee until the maturity of the note. The deed of trust shows on its face that the note was due at a future date. To construe the clause giving the trustee the power of sale in any other manner would be an absurdity. In addition to all that the trustee's deed, being regular on its face, conveyed a good title and its recitals even in a court of law, make a prima-facie case and on the records of the county constituted a muniment of title importing absolute verity and giving absolute protection to a person dealing with the land on the strength thereof.
One who deals with land is not required to go beyond the records of the county where it is situated in the absence of actual notice and in the nature of the facts the Federal Land Bank could have had no actual notice of the alleged infirmities. Barksdale v. Learnard, 112 Miss. 861, 73 So. 736; Freeman on Co-tenancy (2 Ed.), pars. 154-156; Smith v. McWhorter, 74 Miss. 400, 20 So. 870; Dickerson v. Weeks, 106 Miss. 804, 64 So. 731; Clark v. Rainey, 72 Miss. 151, 16 So. 499; Atkinson v. Greaves, 70 Miss. 42, 11 So. 688; Conn v. Boutwell, 101 Miss. 353, 58 So. 105; 1 Perry on Trusts (6 Ed.), par. 218; Dickerson v. Weeks, and Watson v. Vinson, supra, are not in conflict herein, for the bona-fide purchaser for value without notice rule, was not involved in either of those cases. In Dickerson v. Weeks, the purchaser of the legal title for the co-tenant who purchased an outstanding superior title to the common property had actual knowledge at the time of his purchase of the rights of the other co-tenants. In Watson v. Vinson, an examination of the original record and briefs of counsel will disclose that the subsequent incumbrancers defended not on the ground that they were without notice that Watson held legal title to the land in trust for his co-tenants, but on the ground that the right of these co-tenants to avail themselves of Watson's purchase was barred because they had delayed doing so for an unreasonable length of time. Conn v. Boutwell, 101 Miss. 353, 58 So. 105; Pomeroy's Equity Jurisprudence (3 Ed.), par. 767; Hill v. Moore, 62 Tex. 610; Edwards v. Brown, 68 Tex. 329, 4 S.W. 87; Patty v. Middleton, 82 Tex. 586, 17 S.W. 909, where the legal title was in the husband; and Daniel v. Mason, 90 Tex. 240, 38 S.W. 161, 59 Am. St. Rep. 815; Goodwynne v. Bellerby, 116 Ga. 901, 43 S.E. 275; 2 Pomeroy's Equity Jurisprudence, par. 739. In Selden v. McCreery, 75 Md. 296, 23 A. 641, affirmed in Economy Savings Bank v. Gordon, 90 Md. 486, 45 A. 176, 48 L.R.A. 67, it is said that where a title is perfect on its face, and no known circumstances exist to impeach it or put a purchaser on inquiry, one who buys bona fide and for value, occupies one of the most highly favored positions in the law. Townsend v. Little, 109 U.S. 504, 3 Sup. Ct. 357, 27 L.Ed. 1012; Pomeroy's Equity Jurisprudence, par. 417. The doctrine of the Barksdale case was reaffirmed in Allen v. Hayes, not officially reported, 107 So. 208. As a matter of fact change the names of the counties and the names of the parties, the age of the minors involved and this case is on "all fours" with the Allen case.
Counsel has attempted to distinguish away the effect of the holding of the court in the Barksdale and Allen cases and relies on Conn v. Boutwell, supra, and Clark v. Rainey, 16 So. 499, making the comment that Allen v. Hayes and Barksdale v. Learnard, did not overrule them. Certainly not, they support the decision of the court in both of the cases mentioned as will be apparent by reading the opinion in the Barksdale case and in the Allen case. Counsel's argument is a distinction which does not distinguish. Barksdale v. Learnard, 112 Miss. 861; Smith v. McWhorter, 74 Miss. 400; Burns v. Dreyfus, 11 So. 107; Allen v. Hayes, 107 So. 208, and the cases cited by the court in the opinion of Barksdale v. Learnard. Nash v. Smith, 96 So. 615.
It is respectfully submitted that the decree of the chancellor as to all the appellees was correct and that the cause should be affirmed.
Hughes, Nobles Lane, in reply brief for appellant.
An examination of the deed of trust will show that no time was fixed in the deed of trust as the time when the same would become due. 17 R.C.L. in the latter half of section 122, page 756, with notation thereunder. We have been unable to find any dissent from the rule thus stated. The deed of trust under which appellee claims title by virtue of the trustee's sale to Dr. Burnett was made and executed on the 11th day of March, 1896, and being duly recorded, was notice to the world that the same was barred six years from the date of its execution. Then under section 2452, Hemingway's Code, the six months' additional time given to the creditor to enter upon the margin of the record, the fact of renewal could not be availed of by the appellee, because given the six months' additional time, added to the six-year-period would have barred the debt and the deed of trust securing the same. In other words the six-year-period plus the six months' additional time in which the creditor may enter on the margin of the record any evidence of renewal was fully completed September 11, 1902, and the alleged sale under the deed of trust did not take place until February 16, 1903, practically five months after the full statutory period of six and one-half years had fully elapsed and the statutory period had been completed. We have no complaint or criticism to make as to the soundness of McBride v. Burgin, 143 Miss. 596, 108 So. 148, decided by Justice McGOWEN.
The real question presented for the court's decision is: can the appellees raise the bona-fide purchasers for value defense by demurrer? Jones et al. v. Grimes et al., 115 Miss. 874, 76 So. 735; McDaniel et al. v. Short, 127 Miss. 520, 90 So. 186.
Watkins, Watkins Eager, in reply brief for appellees.
The entire bill in so far as charging facts upon which fraud can be predicated is vague, indefinite and insufficient. McInnis v. Wiscassett Mills, 78 Miss. 52, 28 So. 725; Railroad Co. v. Neighbors, 51 Miss. 412; Watts v. Patton, 66 Miss. 54; Richardson v. Davis, 70 Miss. 219; Mitchell v. Southern R. Co., 77 Miss. 917, 27 So. 834; Jones v. Rogers, 85 Miss. 802, ___ So. 742; State v. Henry, 87 Miss. 125, 40 So. 152; Metcalfe v. Bank, 89 Miss. 649, 41 So. 377; Merchants Farmers Bank v. Bank of Winona, 106 Miss. 471, 65 So. 210; Harton v. Lincoln County, 116 Miss. 813, 77 So. 796; State v. Creswell, 117 Miss. 795, 78 So. 770. A demurrer while admitting all matters of fact well pleaded, however, does not admit conclusions of law stated by the pleader. Perkins, Administrator, v. Guy, 55 Miss. 153, 30 Am. Rep. 510.
A foreclosure sale is an involuntary sale. The beneficiary is vested with rights of his own when the deed of trust is executed; and the mere fact that one of the parties who signed the deed of trust should enter into an agreement with a stranger to the transaction and after refusing to pay his debt allows the land to sell, did not vitiate the sale in the absence at least of some other attending facts and circumstances showing that either the beneficiary or the trustee were parties to or had notice of such fraud or that on account thereof bidding was stifled and the land sold for less than it otherwise would have produced.
If a beneficiary in a deed of trust had the right to foreclose when the sale was made, the fact that such sale was the result of an agreement with a junior encumbrancer in no wise effects its validity. Weir v. Jones, 84 Miss. 602, 36 So. 533, 84 Miss. 610, 37 So. 128. A sale of land made by a trustee otherwise valid will not be set aside for mere inadequacy of price unless the inadequacy is such as to shock the conscience. Wayburn v. Watkins, 90 Miss. 728, 44 So. 145.
The debt was not barred at the time of foreclosure because there are no allegations in the bill of complaint that the debt had not been extended or renewed. Sec. 2452, Hem. Code 1927; McBride v. Burgin, 143 Miss. 596, 108 So. 148.
Appellant, Mrs. Allie Heard Fulgham, complainant in the court below, prosecutes the appeal here from a decree of the chancery court sustaining the demurrers to the bill of complaint filed by Mrs. Olivia Burnett et al. and the Federal Land Bank. The court below granted an appeal to settle the principles of the case.
The facts and essential allegations of the bill are conceded to be as follows:
"The appellant, Mrs. Allie Heard Fulgham, filed her bill of complaint in the chancery court of the Second judicial district of Hinds county, Miss., against the appellees, in which complainant charges that she is the daughter of Cicero Heard and his deceased wife, Yancie L. Heard, the latter departing this life some time prior to the 16th day of February, 1903, and that complainant and a sister, Ruby Heard, were the sole heirs at law of their deceased mother, Yancie L. Heard. That Yancie L. Heard, at the time of her death, was seized and possessed, in fee simple, of a one-fourth undivided interest in certain land described in the bill of complaint, and that complainant and her minor sister, upon the death of their mother, became seized and possessed of a one-twelfth undivided interest each in the lands mentioned; that Ruby Heard, a sister of complainant, later married one John Carmichael; that, after Ruby's marriage to John Carmichael, she died, leaving her husband, John Carmichael, as her sole heir at law, who became vested with the title of his departed wife to a one-twelfth interest in the lands mentioned, and that, some time in the month of December, 1926, John Carmichael conveyed his one-twelfth interest in said lands to complainant. The bill then alleges that, on the date of filing same, complainant was vested with a complete legal and equitable title to a one-sixth interest in the lands described in the bill of complaint. The bill of complaint further alleges that on the 11th day of March, 1896, Cicero Heard and his wife, Yancie L. Heard, the father and mother of complainant, executed a deed of trust to J.N. Carpenter Co., to secure a note and indebtedness in the sum of three thousand nine hundred seventy-one dollars and fifty-six cents, due and payable on or before the 1st day of December, 1896, and that the said deed of trust embraced all of the above-mentioned lands as security for said indebtedness. That on the 16th day of February, 1903, the trustee named in the deed of trust attempted to sell all of the said land to satisfy a small balance alleged to have been due on the said note and deed of trust, and that the trustee executed a trustee's deed to Dr. E.J. Burnett, in which the sum of one thousand eight hundred dollars was recited as being the consideration paid by Dr. E.J. Burnett at the trustee's sale.
"The bill of complaint then alleges that Dr. Burnett unlawfully conspired and entered into collusion with Cicero Heard for certain considerations agreed to refrain from appearing and bidding on the land when the same was to be sold at the trustee's sale. The bill alleges that Dr. E.J. Burnett, in consideration of Cicero Heard not bidding on said land at said sale, and permitting Dr. E.J. Burnett to buy said land at a recited consideration of one thousand eight hundred dollars — that Dr. Burnett was to convey, and did convey, to Cicero Heard's wife, Sallie, whom the latter had married after the death of his first wife, Yancie L. Heard, for the benefit of Cicero Heard, a tract of land consisting of one hundred sixty acres at a recited consideration of two thousand eight hundred fifty dollars, but charges that the consideration, as a matter of fact was never paid, and that the conveyance to Sallie Heard was made to her as trustee for the benefit of Cicero Heard, and that Sallie Heard sold said land, and that all of the consideration paid for said land was paid to Cicero Heard. The bill then alleges that on the 14th day of February, 1903, Dr. Burnett approached T.H. Heard, the brother of complainant, and secured from him a quitclaim deed to this land, for which he paid the said Heard one hundred fifty dollars. This transaction was had four days before the date of the trustee's sale at which Dr. E.J. Burnett became the purchaser of all of this land. The bill alleges that the one hundred fifty dollars paid T.H. Heard was in consideration of the said T.H. Heard refraining from bidding on the said land at the trustee's sale.
"The bill also alleges that, at the time of the trustee's sale, the complainant and her sister, Ruby, were both minors of tender years. The bill also alleges that, at the time of the trustee's deed to Dr. E.J. Burnett, of date, of February 16, 1903, was void, and conveyed no title because the note secured by the deed of trust under which the attempted sale was made was barred by the six-year statute of limitations, that both the right and the remedy to sell under the said deed of trust were barred and extinguished.
"Then, in detail, the bill charges that complainant has never parted title, by deed of conveyance or otherwise, to her interest in the lands inherited from her mother, that she has never acquiesced in the possession or conveyances to Dr. E.J. Burnett or his vendees, nor, in any wise, ratified or confirmed said trustee's sale and trustee's deed thereunder. The bill charges further that, on the 1st day of May, 1924, Dr. Burnett undertook to convey these lands that he had bought at the alleged trustee's sale to his wife, Mrs. Olivia Burnett, but charges that the conveyance was without consideration, and that, at the time the same was made, Mrs. Olivia Burnett had actual knowledge of all of the infirmities and defects with which the said trustee's deed was affected, that she had actual knowledge of the fraudulent manner in which Dr. E.J. Burnett, her husband, had acquired title to these lands, and that she was not an innocent purchaser, for value, without notice. The bill of complaint specifically charges that each and all of the fraudulent acts set out were had and done with a common understanding that it was for the purpose of vesting the apparent legal title in Dr. E.J. Burnett and his assigns for the purpose of defeating the rights and title of complainant and her minor sister of their interest in these lands. The bill of complaint alleges that Dr. E.J. Burnett and Olivia Burnett executed and delivered to the Federal Land Bank of New Orleans, La., a deed of trust on said lands to secure an indebtedness to said bank, and, while the bill of complaint charges that the deed of trust to the bank was void, the complainant does not resist the right of the bank to subject five-sixths interest in said land to the payment of the indebtedness due the bank by the Burnetts."
The appellant assigns as error the action of the court in sustaining the demurrers, and asserts that the foregoing facts set up a case in equity which entitled the complainant to relief.
Counsel for complainant, appellant here, frankly concedes that the one-twelfth interest of Ruby Heard Carmichael, conveyed to complainant just before the filing of this suit by the husband of Mrs. Carmichael, was and is barred by the statute of limitations of ten years, and that the appellant cannot maintain a bill in equity as to this one-twelfth interest, but insists that his bill shows a case for recovery of the one-twelfth interest inherited by the complainant from her deceased mother.
2. As to the demurrer of the Federal Land Bank, we think the bill amply discloses that there was nothing in the deed records of Hinds county to show a stranger the secret equity of appellant in the land, and that, so far as the record is concerned, it is disclosed that the Federal Land Bank was an innocent incumbrancer for value without notice of the asserted right of the appellant to require her trustee, Dr. Burnett, to account to her for her interest in the land, and the rents thereof.
We think the case is controlled by the rule announced in Barksdale v. Learnard, 112 Miss. 861, 73 So. 736, and the authorities there cited, and which was reaffirmed in the case of Allen v. Hayes (Miss.), 107 So. 208, not officially reported.
The demurrer of the Federal Land Bank on this ground was properly sustained by the court below.
3. As to the reasons assigned here by Olivia Burnett et al. for sustaining the demurrer to the bill, we shall consider same from the standpoint of the appellee as outlined in his brief. The first point assigned by counsel for appellee is as follows:
"The relief prayed for in the bill of complaint is based on fraud, and the charges in respect to fraud are the legal conclusions of the pleader, and contain no material facts upon which fraud can be predicated."
The allegations of the bill that Dr. Burnett, with the purpose of depriving the appellant of her title, procured land worth ten thousand dollars for one thousand eight hundred dollars at a public sale, and that, according to the recital of the deed, he conveyed two thousand eight hundred fifty dollars worth of land to the wife of Cicero Heard, and received nothing therefor, and that the brother of the appellant conveyed his interest, and that these people, relatives, the father and brother, agreed with Dr. Burnett that they would not bid on this land, constituted what is commonly called a "chilling of bids" at a public sale. The allegations of the bill, excluding the conclusions of the pleader, are sufficient to charge fraud as against a minor daughter on the part of her father, brother, and Dr. Burnett. So we think there is no merit in this contention.
In the second place, it is urged that the bill of complaint fails to allege any facts showing the foreclosure sale to have been irregularly or illegally conducted, or that either the beneficiary or the trustee were parties thereto.
As we have hereinbefore stated, the fact alleged that Dr. Burnett hired these adults, closest in point of relationship to the minor, not to appear and bid at the sale, constituted a fraud on the part of Dr. Burnett who was the purchaser at the sale, and it was not necessary that the bill should charge that either the beneficiary or the trustee were parties thereto.
Prospective bidders at a public sale cannot fraudulently agree together to refrain from bidding one against the other, and to do so renders the sale to any one of the confederates void. 6 R.C.L., p. 810, section 210.
4. It is urged that the demurrer was properly sustained, because Mrs. Fulgham is estopped to assert that she had any interest in the lands involved, because the bill does not allege that she did not receive her part of the money in excess of the debt.
There is no merit in the contention. It is not alleged there was an excess over and above the debt, and whatever there is in this proposition is a matter of defense, and is not maintainable on demurrer.
5. "The debt was not barred at the time of foreclosure because there is no allegation in the bill that the debt had not been extended or renewed." Section 2452, Hemingway's 1927 Code, section 2796, Code of 1906, is to the effect that, when a lien appears by the record to be barred, it ceases. From the allegations of the bill, as to the record, it would appear that this foreclosure was had at a time when the debt appeared to be barred. But counsel, relying upon that part of the above section which provides that, within six months after such remedy is so barred, if such mortgage, deed, or trust or lien be renewed or extended on the margin of the record, it shall be renewed, asserts that every presumption is in favor of the validity of the trustee's deed. In the case of McDaniel v. Short, 127 Miss. 520, 90 So. 186, Judge HOLDEN announced this rule:
"The attempted sale under the barred debt and security conferred no title upon the purchaser, nor could the sale ordered by the court to enforce the lien be valid because the lien was extinguished and could not be revived. Taking possession of the land . . . under these circumstances was wrongful, and the appellee did not acquire the rights of a mortgagee in possession. The mortgage was extinguished before the possession was taken."
It is therefore evident that, on the allegations of the bill, and the face of the record, the trust deed was barred in this case, and if, indeed, there had been an entry made on the record showing a renewal or extension of the mortgage under which this land was sold by foreclosure proceedings, then such a matter would be defensive, and it would be a matter of proof, on pleadings properly made up and issue tried on the facts as developed.
We do not think the complainant in the court below was required to negative all possibilities, or anything that might remove the mortgage from the bar of the statute of limitations.
The demurrer conceded the facts alleged in the bill. We think the bill, as a whole, sufficiently charges grounds for equitable relief, and calls for an answer, on the part of the appellees, defendants in the court below, and, as to the appellee, Mrs. Burnett, and her daughters, their demurrer should have been overruled.
Affirmed in part, and reversed in part, and remanded.